Flying can be a hefty expense â especially when youâre buying more than one airline ticket at a time. If you frequently fly with a companion, whether it be your child, spouse or friend, a companion pass can drastically reduce your travel costs.
While the terms vary depending on the airline and credit card, generally, companion passes allow a second passenger to fly with you for free or at a significantly discounted rate. Some credit cards automatically offer a companion pass when you are approved for the card or each year on your account anniversary. Others require you to charge a certain amount within a given time frame to earn the pass.
For more details on some of the most common companion passes, including what they offer and how to earn them, read on.
AAdvantage® Aviator® Silver World Elite Mastercard®
British Airways Visa Signature® Card within a 12-month period, starting on Jan. 1 and ending on Dec. 31. For example, if you opened your card account in June 2020, you have until Dec. 31, 2020 to reach the spend requirement for that year.
How long is the Travel Together Ticket valid?
The Travel Together ticket is valid for 24 months from the date of issue.
Which cards help you qualify?
British Airways Visa Signature® Card
Delta SkyMiles Reserve® American Express Card
Hawaiian Airlines® World Elite Mastercard® (50 percent and $100 discounts)
Hawaiian Airlines® Bank of Hawaii World Elite Mastercard® (50 percent and $100 discount)
Hawaiian Airlines® Business Mastercard® (50 percent discount)
Alaska Airlines Visa Signature® or Alaska Airlines Visa® Business cardholder. As part of the introductory offer, you much spend $2,000 in the first 90 days to receive a companion fare. You will automatically receive the companion fare each year on your account anniversary.
Travel must be booked on alaskaair.com.
How long is the fare valid?
The Famous Companion Fare is valid from the date of issue until your next account anniversary.
Which cards help you qualify?
Alaska Airlines Visa Signature® credit card
Alaska Airlines Visa® Business
How to get the Southwest Companion Pass, Earn sign-up bonus miles with the Southwest Rapid Rewards cards
The Bank of America content of this post was last updated on March 20, 2020.
Have you ever wondered about the uses of a credit card vs. a debit card? It’s likely you have both types of cards in your wallet at this very moment, and you’re given the option to choose one of themâsometimes in a matter of secondsâevery time you make a purchase. Still, you have lingering uncertainty about whether you’re making the best choice… and that same question pops into the back of your mind every time you buy something: “Should I use a credit card or debit card?”
Being uncertain about the difference between a credit card and debit card or the best time to use either is a common dilemma. The better you understand the benefits of eachâbeyond the fact they offer a way to access money without having to carry cash or a checkbook aroundâthe savvier a spender you’ll become.
Managing revolving credit vs. a bank account balance
Credit cards and debit cards both offer a convenient way to pay for things, but they work quite differently behind the scenes. As a result, they each appeal to different types of consumers, says Lou Haverty, financial analyst and founder of Financial Analyst Insider.
A credit card is a form of revolving credit. When you spend with your credit card you are borrowing, and you pay interest if you carry a balance, Haverty says. A debit card, by contrast, is linked to a bank accountâusually a checking accountâand the money is withdrawn as soon as you make the transaction, typically using a PIN.
A difference between credit cards and debit cards is that with a credit card, the exact amount you can spend depends on your credit limit and the balance you are currently carrying on the card, Haverty explains. If you have a $1,000 credit limit and a $600 balance from previous purchases, you can continue to charge an additional $400. If you’ve reached your credit limit, you won’t be able to use the card for more purchases until you pay off at least part of the balance. You owe a minimum payment each month.
When considering credit card vs. debit card, know that most credit cards carry an interest rate, expressed as an annual percentage rate (APR), which is essentially what you pay to borrow. You’ll have to pay interest on that $600 balance mentioned above if you carry the balance from month to month. âCredit cards require a responsible approach to your personal finances because you have the ability to spend beyond what you might have as cash in your bank account,” Haverty says.
A difference between credit cards and debit cards is that with a debit card, funds are pulled directly from the balance you have in the checking account to which the card is linked. In a traditional account setup, you can’t spend more than what you have in the account, which helps reduce the chance of racking up debt. If your account offers overdraft protection, you may be able to spend more than your account balance by leveraging funds from a different, linked bank account.
âCredit cards require a responsible approach to your personal finances because you have the ability to spend beyond what you might have as cash in your bank account.”
Knowing the requirements for each card
Another key difference between a credit card and a debit card is the criteria you’ll need to meet for each. âGetting approved for a credit card is usually dependent on your personal credit score. The higher your credit score, the more likely you are to be approved,” Haverty says. âIf you have a lower credit score, you may still get approved, but you might have a lower credit limit.”
Patricia Stallworth, certified financial planner and money coach, says that in addition to your credit history, factors such as your employment status could play a role in credit card approval.
When analyzing credit cards vs. debit cards, consider that a debit card is typically issued automatically when you open a checking account. This process usually requires some personal information, such as a Social Security number, driver’s license, employment information and valid email address. A deposit may also be needed to fund the account and complete the application. Then stay tuned for your debit card in the mail!
When should I use credit vs. debit?
While it’s easy to have credit card vs. debit card on the mind, there are some scenarios in which using either a debit card or a credit card could fit the bill, depending on your financial needs and goals. Use the outline below as a guide for when the question of “When should I use credit vs. debit?” comes up:
You’re new to using a card to make purchases. Until you know you have the discipline to control your spending with a card, a debit card could be the way to go, as it’s a great tool for ensuring you don’t charge more than you can afford. âDebit cards are great for everyday purchases that you have budgeted for because the money comes directly out of your account,” Stallworth says.
You want cash back without the fees. If your debit card is linked to a checking account that offers rewards, Stallworth says you may have rewards-earning potential without the hassle of fees. âWhile there is generally no cost to participate in debit card rewards programs, the costs and fees may be higher with some credit card programs,” she adds. For instance, Discover Cashback Debit charges no fees1 and allows you to earn 1% cash back on up to $3,000 in debit card purchases each month.2
Why should credit cards have all the fun?
Now you can earn cash back with your debit card.
Learn More
Discover Bank, Member FDIC
You have debt you can’t pay off. When should I use credit vs. debit? âIf you’re struggling to manage or get out of debt, a debit card should be your ‘go-to card,’” Stallworth says. “You can’t get out of debt if you keep charging.”
You want cash at the register. If you still like to have cash in your wallet, consider this difference between credit cards and debit cards: Most retail stores will allow you to get cash at the register when you pay with your debit card. âA credit card will most likely charge you a cash advance fee if that feature is available,” Haverty says.
“Debit cards are great for everyday purchases that you have budgeted for because the money comes directly out of your account.”
Use your credit card if…
You want product coverage. Some credit cards come with purchase protection, which makes them a great option for online and large purchases, Stallworth says. “If I have a dispute with a merchant, I have more leverage with a large credit card company behind me.”
You’re trying to build (or rebuild) your credit. âYou will need a single credit card with a small limit that you pay off in full each month to build a credit history,” Haverty says. A key difference between credit cards and debit cards is that debit card usage can’t help you build a credit history. A debit card can help you build strong budgeting skills so you’re better prepared to transition to a credit card.
You want to earn travel rewards. If you’re debating credit card vs. debit card and are focused on travel, consider that credit card rewards programs may offer robust rewards in a specific category, like travel, Stallworth says. While it’s always important to read the fine print (so you’re not paying more than you intend in fees or interest rate charges just to get rewards), you could find a credit card that offers opportunities to earn free flights and pay less for checked baggageâjust for using the card regularly.
How to use both cards to maximize your finances
Now that you understand which circumstances might be best to use a credit card vs. debit card, you can make the point-of-purchase decision of “When should I use credit vs. debit?” a little easier. It really depends on the goals you have laid out for your personal finances.
Get comfortable using both financial tools for their respective features. But be sure to stick to your budget, and don’t accidentally overspend from your bank account or charge more than you can afford to pay in full by your credit card’s monthly due date. When you learn to confidently use both of these cards to your advantage, you can enjoy all the various perks and protectionsâtimes two!
1 Outgoing wire transfers are subject to a service charge. You may be charged a fee by a non-Discover ATM if it is not part of the 60,000+ ATMs in our no-fee network.
2 ATM transactions, the purchase of money orders or other cash equivalents, cash over portions of point-of-sale transactions, Peer-to-Peer (P2P) payments (such as Apple Pay Cash), and loan payments or account funding made with your debit card are not eligible for cash back rewards. In addition, purchases made using third-party payment accounts (services such as Venmo® and PayPal, who also provide P2P payments) may not be eligible for cash back rewards. Apple, the Apple logo and Apple Pay are trademarks of Apple Inc., registered in the U.S. and other countries.
The post The Difference Between Credit Cards and Debit Cards: Explainedâââ appeared first on Discover Bank – Banking Topics Blog.
Only a decade ago, people called a taxi company when they needed a ride. The same act is now as simple as hitting a few buttons on your smartphone.
Ride-share companies like Lyft make getting a ride to almost anywhere a breeze, and the service may cost a lot less than you think.
If you charge your Lyft rides to a credit card that doles out points or miles, thatâs even better. In this guide, weâll go over the absolute best credit cards to use when you ride with Lyft as well as other ways to maximize your ride-share dollars.
See related: Everything you need to know about maximizing rewards on ride-shares
Chase Sapphire Reserve®: Best for Lyft discounts
Chase Sapphire Preferred® Card: Best for extra value at a lower fee
American Express® Green Card: Best for budget-minded travelers
Wells Fargo Propel American Express® card: Best no annual fee card for ride shares
Best credit cards to earn rewards with Lyft
There are a handful of credit cards that can help you earn rewards each time you ride with Lyft. Here are your best options:
See related:Â Best cards for Uber, UberEATS
Chase Sapphire Reserve®: Best for Lyft discounts
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In January 2020, the Chase Sapphire Reserve began to offer a one-year complimentary Lyft Pink membership. For a $19.99 monthly fee, Lyft Pink offers passengers 15% off all car rides, in addition to priority airport pickups, special discounts and more flexibility in cancellations, among other benefits. The Reserve is also offering 10 points per dollar on Lyft purchases through March 2022.
Besides these perks, the card comes with a 3-point-per-dollar rate on restaurants and travel, including Lyft, after the $300 annual travel credit. Speaking of the credit, it applies to most travel purchases, including rides with Lyft.
The Chase Sapphire Reserve card is one of the best travel credit cards on the market, but it also comes with a rather high price â the card charges an annual fee of $550. If you donât travel often enough to justify the fee, you might want to look into cards that have a lower annual fee or none at all.
Here are more details:
One-year complimentary Lyft Pink membership (a $199 value)
10 points per dollar on Lyft purchases through March 2022
3 points per dollar spent on restaurants and travel,
$300 annual credit travel that applies to most travel purchases, including rides with Lyft
50,000-point sign-up bonus if you spend $4,000 in first three months
Redeem points through the Chase Ultimate Rewards portal, and get 50% more travel for free
Transfer points to airline and hotel partners at a 1:1 ratio
Up to $100 Global Entry/TSA Precheck credit every four years
Priority Pass Select membership
$550 annual fee
exciting new benefits for its World and World Elite credit card members. This includes a $10 Lyft credit for World Elite cardholders, which will be automatically applied to your next ride after you take five Lyft rides within a calendar month. The most popular World Elite Mastercards include the Capital One® Savor® Cash Rewards Credit Card*, the Citi Prestige® Card and the Barclaycard Arrival Plus World Elite Mastercard.
Chase Sapphire Preferred® Card: Best for extra value at a lower annual fee
Similar to the Chase Sapphire Reserve, the Chase Sapphire Preferred rewards cardholders for eating out (or ordering takeout) and traveling and offers 5 points per dollar on Lyft through March 2022. The base rewards rate is lower at 2 points per dollar on dining and travel and 1 point per dollar on other purchases, but the annual fee is also lower at $95.
If youâre not ready to shell out $550 per year that the Reserve charges, the Preferred can be a better alternative. Plus, it offers a higher sign-up bonus than the Reserve â youâll get 60,000 points after you spend $4,000 in the first three months (compare with a 50,000-point sign-up bonus if you spend $4,000 in first three months on the Reserve).
Take a look at the card details:
5 points per dollar on Lyft through March 2022
2 points per dollar spent on dining and travel
60,000-point sign-up bonus if you spend $4,000 in first three months
Redeem points through the Chase Ultimate Rewards portal, and get 25% more travel for free
Transfer points to airline and hotel partners at a 1:1 ratio
$95 annual fee
American Express® Green Card: Best for budget-minded travelers
Another credit card that offers rewards for travel and transit (including ride-shares such as Lyft) is the American Express Green Card. While it doesnât offer the luxury travel perks other Amex cards are known for, it can be a good choice for budget-minded travelers. With this card, you can get 3 points per dollar on dining, travel and transit, and 1 point per dollar on everything else. The Amex Green also comes with perks such as up to $100 in annual statement credits for LoungeBuddy purchases and up to $100 per year for CLEAR membership.
complimentary Uber Eats Pass membership for up to 12 months if you enroll by Dec. 31, 2021.
Hereâs what the card offers at a glance:
3 points per dollar spent on travel and transit, including rideshares
3 points per dollar spent on dining
30,000 bonus points when you spend $2,000 in the first three months
Up to $100 per year in statement credits for LoungeBuddy purchases
Up to $100 per year in statement credits for CLEAR membership
$150 annual fee
Wells Fargo Propel American Express® card: Best no annual fee card for ride shares
If youâre looking for a credit card that would earn you rewards on Lyft rides and not charge an annual fee, the Wells Fargo Propel American Express is definitely an option worth looking into.
The card earns 3 points per dollar in numerous categories, including dining out, gas stations, transit, flights, hotels, homestays, car rentals and select streaming services â and ride-shares. All other purchases earn 1 point per dollar. You can choose to redeem your rewards for flights through Go Far Rewards or statement credits.
Hereâs a closer look:
Earn 3 points per dollar on dining out, gas stations, ride-shares including Lyft, transit, flights, hotels, homestays, car rentals and select streaming services
Earn 20,000 bonus points when you spend $1,000 on your card within three months of account opening
Redeem for flights through Go Far Rewards
Cash in your points for statement credits
No annual fee
More ways to maximize rewards (and save money) when you pay for ride-sharing services
While using the right credit card can help you score more rewards each time you ride with Lyft, there are other ways to make the most of your ride-share spending. Here are some tips that can help you maximize each dollar you spend, save money and even earn airline miles:
Connect your Lyft account with your Delta SkyMiles account. Regardless of which credit card you use to pay for your Lyft rides, you can earn Delta SkyMiles for each dollar you spend. All you are required to do is connect your Delta and Lyft accounts online. From there, youâll earn 1 Delta mile for each dollar you spend on regular rides and 2 miles per dollar for rides to or from an airport.
Price shop with both ride-sharing companies. The best way to spend less on ride-sharing is to make the two main companies â Uber and Lyft â compete. Download both apps on your phone and check pricing with each before you request a ride. If one ride-sharing company is significantly cheaper, they should be your obvious choice.
Avoid surge pricing when you can. Both Uber and Lyft enact âsurge pricingâ in situations where demand is especially high. If you can avoid paying for a ride during a surge, you will save money over time. This is yet another reason to compare pricing on both apps before you book a ride; both ride-sharing companies may not have surge pricing at the same time.
Refer friends and watch out for coupons. If youâre just now signing up for Lyft, make sure someone who already has the app sends you a referral code that makes your first ride free. Also note that, once you have your own Lyft account, youâll get a free or discounted ride for each new person you refer who signs up and takes a ride. Finally, keep your eye out for special promotions and coupons you can add to your account.
Bottom line
To find the best cards for Lyft to share with you, weâve compared all cards that offer benefits and perks related to ride-sharing and Lyft specifically. These cards can help you maximize your potential earnings and savings on Lyft rides, and if you use Lyft frequently, one of these products can be a great addition to your wallet.
*All information about the Capital One Savor Cash Rewards Credit Card has been collected independently by CreditCards.com and has not been reviewed by the issuer. Capital One Savor Credit Card is no longer available through CreditCards.com.
, who also provide P2P payments) may not be eligible for cash back rewards. Apple, the Apple logo and Apple Pay are trademarks of Apple Inc., registered in the U.S. and other countries.